In re SRS Industries (GST AAR Tamilnadu)
M/s. SRS Industries, a proprietary concern in Chennai, manufactures fly ash bricks and cement bricks. The company sought an advance ruling from the Tamil Nadu Authority for Advance Ruling (AAR) to clarify several Goods and Services Tax (GST) matters concerning its primary product, fly ash bricks. The company’s application was based on a need for clarity regarding the correct Harmonised System of Nomenclature (HSN) code, the applicable GST rate, and eligibility for Input Tax Credit (ITC). The firm’s application was partly prompted by a Gujarat High Court ruling that had set a precedent, suggesting a 5% GST rate for fly ash bricks.
The company’s representatives appeared before the AAR and confirmed the composition of their fly ash bricks: approximately 50% fly ash, 45% quarry dust, and 5% cement. They also stated that they procure all raw materials from local, registered suppliers and avail ITC on these purchases. Their clients are primarily private builders and contractors, with some sales to government housing boards.
Analysis of the Ruling
The AAR systematically addressed each of the eight questions raised by SRS Industries, providing a clear ruling on each point.
Classification and GST Rate
The AAR determined that the correct HSN code for fly ash bricks is 6815 99 10. This classification falls under S. No. 176B of Schedule II of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017. The authority clarified that as of July 18, 2022, the condition regarding the fly ash content (more than 51%) was removed from the notification. Consequently, all fly ash bricks are now subject to a standard GST rate of 12% (6% Central GST + 6% State GST).
